Tesco reports large fall in profits

02 October, 2013

ByAntonia Hawken

Tesco has announced a drop of nearly a quarter in its statutory profit before tax, the supermarket chain has revealed.

Releasing its interim results today (2 October) for the 26 weeks ending 24 August 2013, Tesco’s overall group trading profits were down 8.8%, falling 12.4% in Asia (ex. China) and 70.8% in Europe. In the UK, group trading profits rose by 1.5%.

Underlying profit before tax has fallen by 8.4%.

Philip Clarke, chief executive, said: “Despite continuing challenges, we have made further progress on our strategic priorities. We are strengthening our UK business, working to establish multichannel leadership and pursuing disciplined international growth.”

Clarke added that Tesco’s performance in the UK has been “strengthened” through this half, particularly in its food business.

Today, Tesco has also announced a partnership with China Resources Enterprise Ltd. (CRE). Commenting on the union, Clarke said: “This, together with the conclusion of our strategic review in the United States, provides further evidence of our commitment to disciplined international growth and, more broadly, our approach to growth and returns.”

Elsewhere, the supermarket chain reported in its UK food like-for-like had increased by 1% in the second quarter, and UK trading margin remained stable at 5.2%.